Russia’s second-largest bank, VTB, pilots bank guarantees on blockchain

VTB, the second-largest bank in Russia after Sberbank, has piloted a brand-new blockchain-based system to release bank guarantees.According to an official announcement last Wednesday, VTB provided a blockchain-enabled bank assurance to the countrys biggest mobile cellular network service provider, MTS.As part of the advancement, the bank provided MTS a guarantee for the satisfaction of payment responsibilities worth 392 million rubles, or $5 million. The industrial operation executed Masterchain– an Ethereum-based blockchain model backed by the Russian main bank.The parties finished the transaction in real time, with VTB providing a digital assurance signed with an enhanced certified signature. Then, MTS accepted the file, sending out a matching notice to the bank.Vadim Kulik, deputy president and chairman of the VTB management board, said that the brand-new integration permits the bank to speed up the procedure of issuance warranties and considerably reduces documentation. Blockchain implementation also gets rid of the dangers of fraud associated with bank guarantees, he noted.Alexander Smirnov, director of business finance at MTS, stressed that the Masterchain-based bank warranties system will also minimize operational costs and increase competition amongst taking part banks.VTB did not right away react to Cointelegraphs request to offer additional details about the development.Introduced back in 2016, Masterchain is called the first blockchain platform licensed in Russia, utilizing regional cryptographic information security techniques. The platform was developed by the Russian Fintech Association together with the Bank of Russia and major financial gamers like Sberbank, Alfa-Bank, Tinkoff Bank and Qiwi.VTBs relocate to present blockchain-based warranties comes amidst a number of significant Russian banks actively exploring blockchain technology.Earlier in December, Alfa-Bank, one of the largest personal industrial banks in Russia, revealed a blockchain-enabled task to automate services for freelancers. In September, Sberbank– the countrys largest state-run bank– signed up with a blockchain-based platform for commodity trade financing through its Swiss subsidiary.

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